The city of Boulder is considering what its energy future will look like. The goal it to acquire "clean, local and reliable" energy in the future, and one voter-approved option is to start a municipal utility. For more information on the history of this decision, click here.

Post office retreats on eliminating Saturday mail

By PAULINE JELINEK Associated Press

Posted:
04/10/2013 09:25:21 AM MDT

Updated:
04/10/2013 09:52:37 PM MDT

Click photo to enlarge

FILE - In this Feb. 7, 2013 file photo, U.S. Postal Service letter carrier Michael McDonald gathers mail to load into his truck before making his delivery run in the East Atlanta neighborhood, in Atlanta. The U.S. Postal Service says it will delay plans to cut Saturday mail delivery because Congress isn't allowing the change. The Postal Service said in February that it planned to cut back in August to five-day-a-week deliveries for everything except packages, as a way to hold down losses.

WASHINGTON—The financially beleaguered Postal Service backpedaled on its plan to end Saturday mail delivery, conceding Wednesday that its gamble to compel congressional approval had failed.

With limited options for saving money, the governing board said the agency should reopen negotiations with unions to lower labor costs and consider raising mail prices.

Yet the board also said it's not possible for the Postal Service to meet its goals for reduced spending without altering the delivery schedule. Delaying "responsible changes," the board said, only makes it more likely that the Postal Service "may become a burden" to taxpayers.

Congressional reaction was mixed, mirroring differences that have stalled a needed postal overhaul for some time. Some lawmakers had urged the agency to forge ahead with its plan, while others had said it lacked the legal authority to do so.

The Postal Service said in February that it planned to switch to five-day-a-week deliveries beginning in August for everything except packages as a way to hold down losses.

That announcement was risky. The agency was asking Congress to drop from spending legislation the longtime ban on five-day-only delivery.

Congress did not do that when it passed a spending measure last month.

"By including restrictive language ... Congress has prohibited implementation of a new national delivery schedule for mail and package," according to the board.

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Disappointed but not wanting to disregard the law, the board directed the Postal Service to delay putting in place the new delivery schedule until Congress passes legislation that gives the agency "the authority to implement a financially appropriate and responsible delivery schedule."

The board made the decision in a closed meeting Tuesday.

"This is good news for rural communities, businesses, seniors, veterans and others who depend on consistent and timely delivery of the mail," said Sen. Bernie Sanders, I-Vt.

But GOP Rep. Darrell Issa of California, chairman of the House Oversight and Government Reform Committee, bemoaned the decision to back away from a "delivery schedule that polling indicates the American people understand and support."

Postal officials said that to restore the service to long-term financial stability, the agency must have the flexibility to reduce costs and come up with new revenues.

"It is not possible for the Postal Service to meet significant cost reduction goals without changing its delivery schedule— any rational analysis of our current financial condition and business options leads to this conclusion," the board statement said.

An independent agency, the service gets no tax dollars for its day-to-day operations but is subject to congressional control. It lost nearly $16 billion last year—$11.1 billion of that due to a 2006 law Congress passed forcing it to pay into future retiree health benefits, something no other agency does.

"Given these extreme circumstances and the worsening financial condition of the Postal Service, the board has directed management to seek a reopening of negotiations with the postal unions and consultations with management associations to lower total workforce costs, and to take administrative actions necessary to reduce costs," according to the statement. It offered no giving further details.

It said the board also asked management to look at further options to raise revenues, including a rate increase.

Fredric Rolando, president of the National Association of Letter Carriers, called the idea of renegotiating labor contracts "insulting and unnecessary," saying that suggestion "is yet another sign that the Postal Service needs new executive leadership." He said Saturday delivery is critical to the Postal Service's future.

"Losing this competitive advantage would not only reduce mail volume and revenue - sending the USPS on a death spiral - but also would disproportionately affect small businesses, the elderly, rural communities, the one-half of the public that pays bills by mail and the many millions who lack access to reliable Internet service. And it would cost tens of thousands of jobs," Rolando said in a statement.

The Postal Service already is executing a major restructuring throughout its retail, delivery and mail processing operations. Since 2006, it has reduced annual costs by approximately $15 billion, cut its workforce by 193,000 or 28 percent, and consolidated more than 200 mail processing locations.

Its package service is growing as more people buy things online, while the volume of letters sent has slumped with increased use of email and other internet services.

Over the past several years, the Postal Service also has advocated shifting to a five-day delivery schedule for mail and packages. It repeatedly but unsuccessfully appealed to Congress to approve the move and to free it from the advance health payments.

The Senate last year passed a bill that would have stopped the Postal Service from eliminating Saturday service for at least two years and required it to try two years of aggressive cost cutting instead. The House didn't pass a bill.

In dire straits, the agency acted on its own on the Saturday issue.

Issa said the reversal "significantly undercuts the credibility of postal officials who have told Congress that they were prepared defy political pressure and make difficult but necessary cuts."

Sen. Tom Carper, D-Del., a leader on postal issues, said he hoped Congress would pass new legislation to address the agency's problems.

President Barack Obama's budget proposal Wednesday includes the same provision as last year on the Post Service—a plan to let the agency realign its business plan to better compete in the changing marketplace.

The spending blueprint from the budget year that begins Oct. 1 includes a proposal for short-term financial relief and long-term changes at the agency that, it says, will result in more than $20 billion in savings over 10 years.

Ballot language:
In November, Boulder voters narrowly approved two ballot issues related to starting a municipal utility: 2B and 2C. You can read the full text of the ballot language on the city's website.

Issue 2B asked voters to increase the existing utility occupation tax by up to $1.9 million a year. The money from the tax, which will be collected from customers by Xcel Energy, will be used by the city to cover the costs of moving forward with forming a municipal utility, such as more studies and legal fees.

Issue 2C asked voters for permission to actually form a municipal utility. The language allows the city to sell the necessary bonds to take over the current system from Xcel, but it states that the city may only move forward with forming a municipal utility if it can start the utility with rates that are the same or cheaper than Xcel's.

Helpful Links:City of Boulder: This is where the city is aggregating all of its documents, meeting information and updates on Boulder s energy future: bouldercolorado.gov/energyfuture

RenewablesYes: This website is run by the group of volunteers that lobbied local voters to pass a utility occupation tax in November to replace the expiring franchise fee from Xcel Energy. Now, the group is advocating for the city to secure a cleaner, more local energy supply. renewablesyes.org

Xcel Energy: Xcel is the largest utility in Colorado, and it currently provides electricity to Boulder. The city s 20-year franchise agreement with Xcel expired at the end of 2010. xcelenergy.com

Boulder Smart Energy Coalition: A citizen group that supports the city's general energy goals but has concerns about the risks involved with starting a municipal utility. bouldersec.com

SmartGridCity: Xcel Energy has installed a smart grid in Boulder. This web site provides more information on that initiative. smartgridcity.xcelenergy.com

Colorado Association of Municipal Utilities: This Colorado Springs-based group represents the state s 29 municipal utilities, which include utilities based in Lyons and Longmont. coloradopublicpower.org